LinkedIn reports there are over 664,000 active Certified Public Accountants (CPAs) in the United States (May 2016). It’s surprising there are not more CPAs considering these

financial professionals consistently experience high wages and steady income growth.

Perhaps there are not more CPAs in the United States because becoming one in the first place is pretty darn tough.

First there is the Bachelor’s Degree in Finance or Accounting, then there is two years of required work experience and graduate level coursework, finally followed by a grueling four

part certification exam.

Let’s not forget, CPAs are also expected to keep up with continuing education credits to maintain their certification. Being a CPA pays well but you must be prepared for the hard work!

You must also be prepared for the level of professional liability involved in such a demanding role. After all, CPAs are responsible for knowing current state and federal regulations, managing highly confidential financial information, and providing rock solid accounting advice.

Errors can be disastrous for clients, as well as damaging for the CPA’s professional life. That’s where CPA Professional (Errors & Omission) Liability Insurance comes into play. CPA Professional Liability Insurance provides a safeguard from disgruntled accounting customers, by helping you defend yourself against a lawsuit. It helps cover your legal and defense costs, as well as any compensation awarded against you.

So now that we’ve touched briefly on the highs (a high salary) and lows (liability claims), let’s take a closer look at what you can expect to earn as a CPA.

The Salary of a Certified Public Accountant

You’ve studied hard and passed your certification exam. Now you can officially become employed as a Certified Public Accountant.

First, you probably want to crunch some numbers and figure out how much income you may expect to earn.

On average, a well-qualified CPA in the United States makes $119,000 per year (Tysiac, September 2017). This does not include bonuses or benefits.

Plus, many CPAs receive annual bonuses averaging as much as 10% of their yearly income. In the case of a seasoned CPA, that could mean a potential $11,900 bonus for doing what you enjoy. Who wouldn’t appreciate such a nice “thank you”?

We did some more digging to find out the various CPA salary levels in relation to experience. Take a look at the figures below:

Entry Level CPA Salary

A CPA just entering the field has reason to be optimistic. Those with less than one year of experience can earn an average CPA starting salary of $66,000 per year (Tysiac, September 2017).

If you are looking for an entry level CPA position, keep an eye out for the following job titles:

Accounts Analyst

Tax Consultant

Junior Accountant

Chartered Accountant

Budget Manager

Mid-level CPA Salary

A Certified Public Accountant working for the past 3-5 years in their profession is considered a mid-level accountant. CPAs in this category make, on average, about $73,000 annually (Payscale, October 2018).

Bonuses can push up mid-level CPA earnings into the $80,000 range.

If you are looking for a mid-level CPA position, you’ll want to look for the following job titles:

Revenue Cycle Administrator

Contracts & Financial Manager Compliance

Senior Accountant

Senior Tax Accountant

Assistant Accounts Manager

Accounting Analyst II

Strategic Program Analyst

By this point in their careers, mid-level CPAs typically have advanced to a management level.

Highest Level CPA Salary

The pinnacle of an Accounting career is to obtain an Executive position. Working in the C-Suite is reported to result in an average salary of $163,540 (Payscale, October 2018).

Payscale.com breaks the average CPA Executive salary down even further (October 2018):

Bonus earnings of $20,714

Annual profit Sharing $19,372

$15,000 annual commission

Senior level CPAs work in various roles for Accounting firms and within large organizations. Their responsibilities are quite broad and generally involve overseeing budgeting, policy and procedures, financial planning, and corporate loss issues.

You know you’re a high-level CPA if you have one of the following job titles:

Chief Financial Officer

Accounts Vice President

Director of Cash Management

Senior Accounts Payable Manager

Senior Accounts Receivable Manager

Senior Partner

How to Earn Extra Money as a CPA

So, if you’re not quite ready for partner or the C-suite, how can you earn more money as a CPA?

We have a few suggestions that might help you earn a bit more cash. Let’s take a peek at some of those options below.

Get More Certifications

The CPA certification isn’t your only option. If you are looking to increase your earning potential, why not explore other types of certifications?

After all, becoming more specialized in your field will only help to make you more valuable as a professional. As we all know, that usually equates to more money.

Explore one of these popular CPA certifications:

Certified Financial Analyst (CFA) A CFA focuses on Investment and Finance. This is a great certification to have under your belt if you want to earn top dollar in an investment firm, on Wall Street or in a hedge fund firm.

Certified Management Accountant (CMA) A CMA certification should be in your wheelhouse if you are looking at top management or executive positions. It indicates a specialty in Management. Management training isn’t something you get as an Accounting major, so this certification can help you earn more and stand out if you’re interested in a Management career.

Enrolled Agent Certification (EA) An EA certification is for tax loving Accountants. It is a designation created by the IRS that demonstrates expertise in the tax code. The EA is a nice certificate to have if you enjoy tax work and don’t have a CPA. It allows you to do things such as represent clients to the IRS and sign tax forms. However, most employers will want you to have a CPA certification anyway.

Certified Internal Auditor (CIA) A CIA certification only makes sense if you are an Audit or Compliance Officer. Someone with a CIA certification typically works within a large company carrying out Audit procedures and assisting Auditors.

Do Some CPA Freelancing

If you are interested in making some extra money on the side as an Accountant, it’s never been easier. The gig economy makes it simple to pick up side jobs without having to do any marketing. There are many applications today that connect freelancers with employers.

As a CPA you may find it easy to pick up extra work during tax season. Helping individuals and companies prepare their taxes can turn into a lucrative freelance income. You may even consider working evenings or weekends for a tax preparation service during the tax season.

If you are interested in making some extra income by taking on freelance projects, here are a few tips:

You are responsible for self-employment tax

You can write off many of your business expenses including the cost of a home office

Target small business by offering package deals that will give them several Accounting services for a flat fee. This helps small businesses manage their Accounting expenses without getting tied into an hourly billing cycle.

Protecting your salary with CPA Professional Insurance

Now that we’ve looked at all the ways to make plenty of money, we’re going to talk more about how CPAs can keep the money they earned.

Remember, CPAs are responsible for critical business decisions and advice. They work closely with individuals and businesses in managing their money. So an inadvertent error or oversight could cause great financial distress for their client – and themselves.

So, whatever path you choose for your Accounting career, make sure you are protected with Professional Liability (Errors and Omissions) Insurance.

Even if you work for an Accounting firm, there is a chance the liability limits for individual employees is quite low, which means you would be responsible for any legal fees or settlement money exceeding your employer’s liability limit. This is something you can check this with your employer.

How would you come up with thousands of dollars out-of-pocket? Would you have to sell personal items? Or maybe dip into your savings?

Of course, if you work as an independent CPA then you are 100% responsible for any liability lawsuits brought against you. Once again, you will do yourself a tremendous service by having liability insurance in place to safeguard both your business and personal assets.

Please click here to find out more about CPA Professional Liability Insurance.